Renta Corporación income reaches 213 million euros
RENTA CORPORACIÓN INCOME REACHES 213 MILLION EUROS
. The company has sold Mixta Africa shares for 25 million euros.
Throughout the January to September period, against a background of deep international financial and real estate crisis, Renta Corporación has recorded revenues of 213.1 million euros, not including 25 million euros of extraordinary income from the sale of shares in Mixta Africa. With respect to ordinary income, the 198.1 million of sales came almost entirely from buildings, with another 15 million in rental income from some assets. Given the global financial collapse, the company’s efforts for maximum liquidity should be highlighted, taking advantage of all opportunities for generating funds, while ensuring the right balance to maintain a specific level of shareholders funds. At the same time, the company is intensively strengthening sales efforts to expand its network of contacts with international investors. A third focus is the continued research of all measures that may contribute to reducing structural costs. Actions taken in this respect represent an annualised savings of 20% with respect to 2007 in terms of personnel and structural expenses.
In its strategy to prioritise liquidity over margin, and taking into account the deepening of the crisis in recent months, the sales operational gross margin was 0.5% during this period.
It should be noted that during this quarter Renta Corporación sold shares amounting to 11.6% of Mixta Africa to international fund Kingdom Zephyr Management, which has allowed Renta Corporación to improve its liquidity. This transaction has provided the company with 25 million euros and has had a net positive effect of 12.6 million euros, contributing to a net profit of 0.5 million euros in the third quarter. Taking this result into consideration, the accumulated net result for the January-September period is a loss of 25.2 million euros.
In line with the strategic plan launched this year, the company has reduced its debt and intensified its transformation activity. Renta Corporación has therefore closed the period with 665.2 million euros of net debt (down from 71 million euros at the close of 2007) and the total cumulative investment stood at 120.7 million euros, 50% of which has been dedicated to transformation of assets in its portfolio.
Another aspect worth highlighting is that as a result of an increasingly selective and cautious approach to the acquisition of assets, the company has discarted options worth 8.7 million euros over the period, equivalent to 321 million euros in investment rights.
The portfolio currently stands at 969 million euros, made up as follows:
• Inventory accounts for 761 million euros
• Investment rights stand at 207 million euros.
• By region, 65% of total assets is in the Spanish market and 35% in the international market.
Barcelona, 23 October of 2008 .
